Tom Ricketts looks to add another pro sports franchise

A rendering of the 20,000-seat stadium Sterling Bay is planning to build at its Lincoln Yards development along the North Branch of the Chicago River.

Chicago Cubs owner Tom Ricketts is teaming up with developer Sterling Bay to add soccer to his local sports empire.

In a deal that could help launch a new United Soccer League franchise at a stadium Sterling Bay wants to build along the North Branch of the Chicago River, Ricketts has signed a letter of intent to become the prospective expansion team's majority owner, the Cubs' chairman and Sterling Bay announced today.

If the league expands to Chicago—it announced in the fall that it plans to do in the next few years—Ricketts would own a two-thirds share of the franchise, according to a source familiar with the deal. The team would play its home games at a 20,000-seat stadium Sterling Bay is planning as an anchor of its 70-acre Lincoln Yards development on the city's North Side.

It's still unclear when or whether the franchise or stadium will come to fruition, and Ricketts' involvement could be contingent upon a number of factors related to the larger Lincoln Yards development and the USL's expansion.

But bringing aboard the owner of one of the most valuable franchises in sports could help validate the USL's future here, as Chicago-based Sterling Bay looks to jump-start its massive project.

"My family is very excited at the prospect of bringing professional USL soccer to Chicago at this terrific new development," Ricketts said in a statement. "Sterling Bay is a tremendous partner and the USL has a great vision for meeting the demands of passionate fans and growing soccer's fan base."

TERMS OF THE DEAL

A source said Sterling Bay paid about $5 million last year for the rights to a Chicago expansion franchise in the USL, which is a minor league to Major League Soccer with 33 teams in the U.S. and Canada.

Ricketts' investment would be just under $3.5 million for the controlling stake in the new franchise, the source said. Sterling Bay would retain an ownership share in the team and would finance and own the stadium, which is slated to be built on land used today as the city's Fleet & Facility Management site at 1685 N. Throop St.

Ricketts would get all game-day proceeds. Sterling Bay would keep revenue from other special events at the venue, such as concerts. Marquee Sports & Entertainment, a Ricketts venture that oversees sales and events at the family's assets, including Wrigley Field, and does consulting work with sports and entertainment clients, will help Sterling Bay land sponsorship and other revenue-generating deals in the area, the source said.

"We couldn't be more excited to be working with the Ricketts family to bring this project to life," Sterling Bay Managing Principal Andy Gloor said in the statement. "With their deep expertise in sports franchising, the Ricketts are an ideal partner for us to collaborate with and energize Chicago sports fans with a new local team to rally around."

WORK AHEAD

Sterling Bay still has plenty of work to do before it can realize its stadium plan and launch the new franchise, which it is now aiming for the 2021 season, according to a company spokeswoman.

While it has spent years amassing properties along the North Branch of the Chicago River between North and Fullerton avenues—namely the former A. Finkl & Sons steel plant—the developer is still angling to acquire a series of parcels it needs to fulfill its ambitious plan and still needs to win community and City Council support for its development.

Some properties in the area are owned by long-standing businesses that may want to stay put in the North Branch Industrial Corridor, which the city opened up last year to residential, office and other commercial uses.

But the developer now has a valuable ally in Ricketts, whose family paid $845 million for the Cubs in 2009 and who is well-versed in the complementary nature of pro sports teams and real estate development.

Photo

Danny Ecker

Cubs owner Tom Ricketts poses for a photo with fans at the 2017 Cubs Convention.

The Cubs' owners are four years into a massive renovation of Wrigley Field and redevelopment of its surrounding area into a playground of restaurants, retail and hospitality that has altered the face of Wrigleyville and set up lucrative new revenue streams for the Ricketts family.

Ricketts could find a similar mix with the USL venture, should Sterling Bay's Lincoln Yards vision materialize as a sprawling campus of offices, residential buildings, retail and entertainment. That would provide crucial foot traffic that many pro franchises are trying to engineer with real estate development around their venues to turn them into miniature entertainment districts. Such developments can be cash centers for teams through concession sales, assets to sell to sponsors, and restaurant and retail leases.

MARKET-SHARE OPPORTUNITY

Ricketts could also see an opportunity to pounce on some of the soccer fan market share that the Chicago Fire has vied to capture in recent years. Despite playing in southwest suburban Bridgeview, the MLS franchise has invested heavily in promoting its brand closer to the city, including at a $20 million soccer facility owned by Fire owner Andrew Hauptman that opened in North Center in 2015.

"It speaks volumes about the growth of the USL when you continue to see interest and investment from proven sports business executives like Tom Ricketts," USL CEO Alec Papadakis said in the statement. "We welcome Tom and the entire Ricketts family to the USL. They bring a proven record of success to the team, and combined with the excellent group at Sterling Bay, we look forward to their contributions to the future of professional soccer in Chicago."

Despite starting the 2018 season with a record-high 33 teams, the Tampa, Fla.-based USL has plans to keep growing. The league has announced plans to add teams next year in Austin and El Paso, Texas; Birmingham, Ala.; and Memphis, Tenn.

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